The Canadian provinces of Nova Scotia and Newfoundland will negotiate to resolve a boundary dispute involving a prime prospective area off Canada's East Coast.
Both provinces claim jurisdiction over the Laurentian sub-basin covering more than 23,000 sq miles between the Southwest coast of Newfoundland and the northern tip of Nova Scotia's Cape Breton Island.
Gulf Canada Ltd. is expected to begin seismic work in the area this summer. The Canada-Nova Scotia Offshore Petroleum Board has avoided issuing new licenses near the disputed boundary area of the basin.
Nova Scotia Premier Russell MacLellan and Newfoundland Premier Brian Tobin are scheduled to meet in the next few weeks to discuss the boundary dispute. Tobin said it is important to try to resolve the dispute by negotiation. He said he will seek arbitration from the Federal Court of Canada if a quick agreement cannot be reached.
Meanwhile, the offshore board has granted licenses on seven undeveloped parcels off Nova Scotia involving work commitments totaling $90 million by companies over the next 5 years.
Chevron Canada Resources Ltd. had the highest work expenditure bid of $66.77 million for a 742,269 acre parcel near Sable Island.
PanCanadian Petroleum Ltd. was awarded two licenses near Sable Island. It is to spend $8.29 million on a 48,826 acre tract near its Cohasset and Panuke oilfields and $2.3 million on another 257,627 acre parcel.
Mobil Oil Canada, Shell Canada, and Imperial Oil Ltd. will join in a $9.5 million program on a 58,068 acre tract southwest of Sable Island.
MariCo Oil and Gas Corp. of New Brunswick will spend $1.7 million on a 14,764 acre parcel northwest of Sable Island.
Hunt Oil Co., Calgary, bid $2.165 million for each of two nearshore Laurentian channel parcels of 715,655 acres and 718,744 acres. The blocks lie east of the northern part of Cape Breton Island.
Three other Laurentian channel blocks seaward of Hunt's tracts and closer to southwestern Newfoundland drew no bids.
The board did not issue any licenses near The Gully, an underwater canyon in the Sable Island area that environmentalists say is a prime habitat for bottle-nosed whales.
Copyright 1998 Oil & Gas Journal. All Rights Reserved.
